The U.S. Congress passed a resolution Feb. 11 to repeal Washington, D.C. tax decoupling laws, potentially costing the D.C. government $600 million in revenue and delaying the 2026 tax filing season for months.
The resolution, passed by both the Republicans in the House of Representatives and Senate along party lines, would prevent the District from rejecting tax cuts specified in the One Big Beautiful Bill Act (OBBBA), an omnibus federal spending bill that passed in July. Georgetown University students are displeased with congressional Republicans’ decision, criticizing it as a threat to the District’s autonomy.
Del. Eleanor Holmes Norton (D-D.C.) criticized the measure, saying it was an attack on the District’s sovereignty.
“This resolution is nothing short of unprecedented and deliberate administrative and fiscal sabotage of D.C.,” Norton said in a press release. “D.C. is hardly an outlier in decoupling parts of its local tax code from the federal one. Congress has never overturned a revenue-raising law for D.C., and doing so now threatens D.C.’s credit rating and will inject chaos in the middle of tax filing season.”
President Donald Trump is expected to sign the measure into law.
Decoupling refers to a state or other jurisdiction choosing to deviate from federal tax provisions, maintaining separate tax laws. D.C. formally divorced from some tax provisions in the OBBBA in December, including tax cuts on tips and overtime.
The choice was projected to save the city about $600 million — approximately $239 million of which D.C.’s Council committed to funding a local child tax credit and earned income credit for low-to-middle-income families. The rest would fund D.C. public works and institutions, like public schools and parks.
Nehmiya Erkelo (CAS ’29), a lifelong D.C. resident, said the congressional resolution is troublesome for District families such as his.
“I grew up in a house of three siblings, and these tax benefits would really help me and my family a lot,” Erkelo told The Hoya. “I don’t think this is a good decision because losing $600 million can affect important public services like schools, transportation and safety. Everyone in D.C. is hit by this.”
The OBBBA is a federal law signed by President Trump in July 2025 that includes significant tax cuts, including tax exemptions with relation to tips, car loans and business expenses.
Victoria Perry, a Georgetown University Law Center professor in the Graduate Tax Program, said decoupling is common among states, but D.C. is vulnerable to Congress’s will because Congress has the authority to overrule the District’s local legislature.
“States frequently change tax provisions,” Perry told The Hoya. “But D.C. is different because it’s not a state. Congress usually doesn’t interfere with D.C. tax policy, but it is certainly within its legal rights to do so.”
Perry said most of the tax provisions in OBBBA relate more to businesses rather than individual wage earners.
“A lot of the costly benefits that D.C. is decoupling from are actually more business-related than individual income tax,” Perry said. “Deductibility of business interest is one example. The costs and revenue are certainly not all being taken from individual taxpayers.”
At-large D.C. Council member Christina Henderson (D) said Republicans are more concerned with supporting President Donald Trump’s tax cuts than the potential effects on D.C. residents.
“Not a single congressional Republican has asked a question about what this resolution will mean administratively or what it will do to the D.C. budget,” Henderson told The Hoya. “They are only concerned about preserving tax cuts that President Trump champions. That’s it.”
Julian Higgins (MSB ’29) — a resident of the D.C.-Maryland-Virginia (DMV) area and member of Hoya Taxa, a student volunteer organization aiding DMV families with their taxes — said he is also unhappy with congressional Republicans’ interference with D.C.’s tax policy.
“It’s really quite hypocritical of the GOP, which frames itself as supporting working families,” Higgins told The Hoya. “These tax cuts are not really helping the working classes.”
If the bill becomes law, the District would have to suspend tax filings for months to create new systems in compliance with federal law.
Henderson said she believes Congress is making a decision based purely on party alignment and is improperly equipped to handle D.C. politics.
“It’s poor policy to change the tax code in the middle of the tax season,” Henderson said. “Any jurisdiction would say, ‘That’s crazy.’ People would say, ‘What do you mean I have to go back and file my taxes again?’ Congress is charging ahead, not from an impact standpoint, but for purely ideological reasons. Common sense and courage is lacking on Capitol Hill right now.”
